diff --git a/.github/workflows/test.yml b/.github/workflows/test.yml
index 8e73141..da2e525 100644
--- a/.github/workflows/test.yml
+++ b/.github/workflows/test.yml
@@ -40,5 +40,7 @@ jobs:
           pip install -r requirements.txt
       - name: Run migrations
         run: alembic upgrade head
+      - name: Start server
+        run: uvicorn app.fastapi_app:app --host 0.0.0.0 --port 8000 &
       - name: Run tests
         run: pytest -q
diff --git a/README.md b/README.md
index 6662d3e..3986b50 100644
--- a/README.md
+++ b/README.md
@@ -108,25 +108,8 @@ while True:
 ```
 
 ## Architecture
-
-```
-+-----------+                    +----------+
-| Producer |                    | Worker  |
-| (enqueue)                    | (lease)  |
-+----+---+                    +----+----+
-     |                              |
-     v                              v
-+----------------------------------+
-|         FastAPI Service           |
-|  /jobs  /queues/*/lease  /dashboard
-+-----------------+----------------+
-                  |
-                  v
-+----------------------------------+
-|       PostgreSQL Database          |
-|  jobs table  users table  indexes
-+----------------------------------+
-```
+Refer to the below image:
+![Architecture Diagram](system-design/Architecture_diagram.png)
 
 ## Features
 
diff --git a/tests/conftest.py b/tests/conftest.py
index 1d4d186..42b8b48 100644
--- a/tests/conftest.py
+++ b/tests/conftest.py
@@ -16,6 +16,10 @@ def _set_test_env() -> None:
     """
     os.environ.setdefault("OPENQUEUE_TOKEN_HMAC_SECRET", "openqueue-test-secret")
     os.environ.setdefault("OPENQUEUE_ENV", "test")
+    os.environ.setdefault(
+        "DATABASE_URL",
+        "postgresql://openqueue:openqueue_password@localhost:5432/openqueue",
+    )
 
 
 # pytest-asyncio guidance (no custom event_loop fixture)
diff --git a/tests/test_api_integration.py b/tests/test_api_integration.py
new file mode 100644
index 0000000..e6fad39
--- /dev/null
+++ b/tests/test_api_integration.py
@@ -0,0 +1,225 @@
+from __future__ import annotations
+
+import os
+import hashlib
+import hmac
+import asyncio
+import uuid
+from typing import Iterator
+
+import asyncpg
+import httpx
+import pytest
+
+
+def _unique_queue(prefix: str) -> str:
+    return f"{prefix}-{uuid.uuid4().hex[:10]}"
+
+
+def _sha256_hex(value: str) -> str:
+    return hashlib.sha256(value.encode("utf-8")).hexdigest()
+
+
+def _hmac_sha256_hex(secret: str, value: str) -> str:
+    return hmac.new(
+        key=secret.encode("utf-8"),
+        msg=value.encode("utf-8"),
+        digestmod=hashlib.sha256,
+    ).hexdigest()
+
+
+@pytest.fixture(scope="session")
+def api_base_url() -> str:
+    return os.getenv("OPENQUEUE_API_URL", "http://localhost:8000").rstrip("/")
+
+
+@pytest.fixture(scope="session")
+def api_token() -> str:
+    return os.getenv(
+        "OPENQUEUE_API_TOKEN",
+        "oq_test_integration_token",
+    )
+
+
+@pytest.fixture(scope="session")
+def database_url() -> str:
+    return os.getenv(
+        "DATABASE_URL",
+        "postgresql://openqueue:openqueue_password@localhost:5432/openqueue",
+    )
+
+
+@pytest.fixture(scope="session")
+def client(api_base_url: str) -> Iterator[httpx.Client]:
+    client = httpx.Client(base_url=api_base_url, timeout=10.0)
+    try:
+        health = client.get("/health")
+        if health.status_code != 200:
+            pytest.skip(f"API not healthy: status={health.status_code}")
+    except httpx.HTTPError as exc:
+        pytest.skip(f"API not reachable at {api_base_url}: {exc}")
+    yield client
+    client.close()
+
+
+@pytest.fixture
+def auth_headers(api_token: str, database_url: str) -> dict[str, str]:
+    async def _ensure_user() -> None:
+        conn = await asyncpg.connect(database_url)
+        try:
+            await conn.execute(
+                """
+                INSERT INTO users (email, api_token_hash, is_active)
+                VALUES ($1, $2, TRUE)
+                ON CONFLICT (api_token_hash) DO NOTHING
+                """,
+                "integration-sha@openqueue.local",
+                _sha256_hex(api_token),
+            )
+
+            # Optional compatibility for environments where API uses HMAC hashing.
+            test_secret = os.getenv("OPENQUEUE_TOKEN_HMAC_SECRET", "openqueue-test-secret")
+            await conn.execute(
+                """
+                INSERT INTO users (email, api_token_hash, is_active)
+                VALUES ($1, $2, TRUE)
+                ON CONFLICT (api_token_hash) DO NOTHING
+                """,
+                "integration-hmac@openqueue.local",
+                _hmac_sha256_hex(test_secret, api_token),
+            )
+        finally:
+            await conn.close()
+
+    asyncio.run(_ensure_user())
+    return {"Authorization": f"Bearer {api_token}"}
+
+
+def test_health_and_ready(client: httpx.Client) -> None:
+    health = client.get("/health")
+    assert health.status_code == 200
+    assert health.json()["status"] == "ok"
+
+    ready = client.get("/ready")
+    assert ready.status_code == 200
+    assert ready.json()["status"] == "ready"
+
+
+def test_job_lifecycle_enqueue_lease_heartbeat_ack_detail(
+    client: httpx.Client,
+    auth_headers: dict[str, str],
+) -> None:
+    queue_name = _unique_queue("it-lifecycle")
+
+    create = client.post(
+        "/jobs",
+        headers=auth_headers,
+        json={"queue_name": queue_name, "payload": {"task": "lifecycle"}},
+    )
+    assert create.status_code == 201
+    job_id = create.json()["job_id"]
+
+    lease = client.post(
+        f"/queues/{queue_name}/lease",
+        headers=auth_headers,
+        json={"worker_id": "integration-worker", "lease_seconds": 30},
+    )
+    assert lease.status_code == 200
+    leased = lease.json()
+    assert leased is not None
+    assert leased["job"]["id"] == job_id
+    lease_token = leased["lease_token"]
+
+    heartbeat = client.post(
+        f"/jobs/{job_id}/heartbeat",
+        headers=auth_headers,
+        json={"lease_token": lease_token, "lease_seconds": 30},
+    )
+    assert heartbeat.status_code == 200
+
+    ack = client.post(
+        f"/jobs/{job_id}/ack",
+        headers=auth_headers,
+        json={"lease_token": lease_token, "result": {"ok": True}},
+    )
+    assert ack.status_code == 200
+
+    detail = client.get(f"/jobs/{job_id}/detail", headers=auth_headers)
+    assert detail.status_code == 200
+    job = detail.json()
+    assert job["status"] == "completed"
+    assert job["result"] == {"ok": True}
+
+
+def test_list_jobs_filters_and_pagination(
+    client: httpx.Client,
+    auth_headers: dict[str, str],
+) -> None:
+    queue_name = _unique_queue("it-list")
+
+    for idx in range(3):
+        resp = client.post(
+            "/jobs",
+            headers=auth_headers,
+            json={"queue_name": queue_name, "payload": {"idx": idx}},
+        )
+        assert resp.status_code == 201
+
+    page_1 = client.get(
+        "/jobs",
+        headers=auth_headers,
+        params={"queue_name": queue_name, "status": "pending", "limit": 2, "offset": 0},
+    )
+    assert page_1.status_code == 200
+    body_1 = page_1.json()
+    assert body_1["total"] >= 3
+    assert body_1["limit"] == 2
+    assert body_1["offset"] == 0
+    assert len(body_1["items"]) == 2
+    assert all(item["status"] == "pending" for item in body_1["items"])
+
+    page_2 = client.get(
+        "/jobs",
+        headers=auth_headers,
+        params={"queue_name": queue_name, "status": "pending", "limit": 2, "offset": 2},
+    )
+    assert page_2.status_code == 200
+    body_2 = page_2.json()
+    assert body_2["offset"] == 2
+    assert len(body_2["items"]) >= 1
+
+
+def test_cancel_pending_job(client: httpx.Client, auth_headers: dict[str, str]) -> None:
+    queue_name = _unique_queue("it-cancel")
+    create = client.post(
+        "/jobs",
+        headers=auth_headers,
+        json={"queue_name": queue_name, "payload": {"task": "cancel-me"}},
+    )
+    assert create.status_code == 201
+    job_id = create.json()["job_id"]
+
+    cancel = client.post(f"/jobs/{job_id}/cancel", headers=auth_headers)
+    assert cancel.status_code == 200
+    assert cancel.json()["status"] == "cancelled"
+
+    status_res = client.get(f"/jobs/{job_id}", headers=auth_headers)
+    assert status_res.status_code == 200
+    assert status_res.json()["status"] == "cancelled"
+
+
+def test_invalid_job_id_returns_422(
+    client: httpx.Client,
+    auth_headers: dict[str, str],
+) -> None:
+    bad_job_id = "not-a-valid-uuid"
+
+    status_res = client.get(f"/jobs/{bad_job_id}", headers=auth_headers)
+    assert status_res.status_code == 422
+
+    ack_res = client.post(
+        f"/jobs/{bad_job_id}/ack",
+        headers=auth_headers,
+        json={"lease_token": str(uuid.uuid4()), "result": {"ok": True}},
+    )
+    assert ack_res.status_code == 422